With the recent wind storm and flooding, it’s a reminder that disasters can happen at any time. Is your business ready? If a catastrophic disaster hit your business, would it be able to survive? Planning for business survival can be simple or complex depending on your needs. Many tools are available to help with the process.
Important things to consider when thinking about disaster preparedness include:
• Insurance coverage
• Who your business is dependent upon, and
• How prepared is your workforce
The first step in making sure you have the right insurance coverage is understanding what hazards you face. Risks from flooding and windstorms are the most common hazards for businesses in Pierce County. Other, less frequent events, such as wild-land fires, volcanic activity and earthquakes also pose potentially catastrophic dangers. A standard insurance policy doesn’t always cover every risk to your business. You should talk with your insurance broker about how well your coverage matches the hazards for your location and operations.
Also consider what would happen to your business due to a disaster someplace else. Every business is dependent upon suppliers and customers. Do you have a supplier that is your only source for an important part of your business process? What would happen if that business was damaged or destroyed in a disaster? How long could you operate without that part or service? What if a major customer suddenly closed? How would that affect your immediate cash flow and long-term sales? Understanding your business dependencies is as important as understanding your immediate physical risks. You may also want to consider purchasing business interruption insurance to cover losses until you are able to reopen.
How prepared are you and each of your workers personally to survive in the hours and days after a disaster? Even if your business was physically un-damaged, how long would it take to have enough workers to resume normal operations? Knowing how to contact your workers is a vital link in getting your business back open. You may also want to consider how social media could help.
Encourage each employee to have a plan for themselves and their families to survive a disaster. Everyone should have enough food, water, and shelter to last them at least three days without any aid, and everyone should have an out-of-area contact for emergencies because local communications right after a disaster are often disrupted. Most large businesses have done some level of planning for “continuity of operations,” so they know what to do in the event of a disaster. Most small businesses have not. After a disaster, as many as 50% of businesses may not survive the following year. Planning for the worst will increase your chances of being among the businesses that survive.
Visit these resources or contact us to help you get your planning process started:
Federal Emergency Management Agency
http://www.ready.gov/business
Puget Sound Offices of Emergency Management
http://makeitthrough.org/
U.S. Small Business Administration
http://www.sba.gov/content/disaster-preparedness
SBA & Agility Recovery
http://www.preparemybusiness.org/planning